Two-warehouse Inventory Model for Deteriorating Items with Shortages under Inflation and Time-value of Money

An inventory problem for a deteriorating item having two separate warehouses, one is a own warehouse (OW) of finite dimension and the other rented warehouse (RW) of infinite dimension, is developed under inflation and time value of money. Deterioration rates of items in the two warehouses may be different, which is time dependent. In addition, we allow for shortages and complete backlogging. Due to different facilities and storage environment, inventory holding cost is considered to be different in different warehouses. The demand rate of items is linear with time, the stocks of RW transported to OW in continuous release pattern.